"Murata of Japan Invests 430 Billion KRW in New Factory in China to Meet MLCC Demand"

(Photo by Murata Manufacturing Official Facebook)

[Asia Economy Reporter Jeong Hyunjin] Japanese company Murata Manufacturing is investing 45 billion yen (4.331 trillion KRW) to build a factory in Jiangsu Province, China, according to reports by Nihon Keizai Shimbun and others on the 7th. With the rapid increase in demand for multilayer ceramic capacitors (MLCC) due to the spread of electric vehicles and other factors, Murata, which holds the number one market share in MLCC, is making this investment from a mid- to long-term perspective.

According to the reports, Murata is making this investment in its Chinese subsidiary Wuxi Murata Electronics, which produces MLCCs. The new factory will be built on the currently owned site. Construction began earlier this month and is scheduled to be completed by April 2024. Nihon Keizai Shimbun reported that the investment scale corresponds to about 20% of the annual capital expenditure and is the largest single investment ever made by the company.

MLCCs are components that help ensure stable current flow in electronic circuits and are used in most electronic products such as mobile phones, PCs, and automobiles, earning them the nickname "the rice of the electronics industry." Murata currently holds a 30% market share in the MLCC market, maintaining the number one position. Samsung Electro-Mechanics ranks second with a market share in the 20% range.

The background for Murata's mid- to long-term investment appears to be the increasing demand for MLCCs. In particular, the spread of electric vehicles has significantly increased MLCC demand. While conventional cars use about 3,000 MLCCs per vehicle, level 3 autonomous electric vehicles require more than 10,000 MLCCs. Additionally, the spread of 5G smartphones and the Internet of Things (IoT) inevitably leads to further increases in MLCC demand.

Murata secures 40% of its sales from MLCCs. Wuxi Murata Electronics is Murata's main factory in China supplying MLCCs to the telecommunications and automotive industries within China. Nihon Keizai Shimbun reported that Murata's sales ratio in China and Taiwan is about 50%. Nihon Keizai Shimbun also stated, "Murata continues to have a policy of increasing MLCC production capacity by 10% annually."

This content was produced with the assistance of AI translation services.